The surge in transnational governance schemes led by non-state actors can be traced back to the incipient globalisation that followed the liberalisation of trade markets in the mid-1970s. These schemes provide public goods, thus complementing – and sometimes replacing – traditional, state actor-led governance schemes.

A diverse set of reasons move non-state actors to engage in these schemes: philanthropy, influence policy, avoid regulation, first-mover benefits, and public relations are among the main such reasons. The Climate Alliance, a coalition of sub-national governments founded in 1990, is possibly the doyen of non-state actor-led transnational governance schemes focused on climate change.

The UNFCCC, the main state actor-led governance scheme in the area of climate change, recognises the potential role that non-state actors may play with regard to achieving the goals of the Convention. Most recently, it does so through the Paris Agreement, which “resolves to strengthen” the existing technical examination process on mitigation, including by improving access to, and participation in, this process by developing country non-Party experts (paragraph 110), and “welcomes the efforts of non-Party stakeholders to scale up their climate actions” (paragraph 118). For all practical purposes, today non-sate actor actions are seen as a valid, and indeed much needed, addition to state actor-led climate change mitigation efforts. Put bluntly, non-state actor actions have risen sharply in the political agenda partly because state actor-led action falls seriously below the levels that would be required to achieve the goals of the Convention.

Yet, as argued in a new paper published in Climate Policy, little is known about the efficiency and effectiveness of non-state actor action in the area of climate change. Critical questions, for which only partial answers exist at best, include:

  • What level of emission reductions can be attributed to non-state actor actions?
  • To what extent do emission reductions attributed to non-state actor actions overlap with emission reductions attributed to state actor actions?
  • At what cost do non-state actor actions reduce emissions of greenhouse gases?
  • Do non-state actor actions attract more private-sector funds, compared to state actor actions?
  • Do non-state actor actions spur, or stifle, state actor actions?

Against this background, it seems legitimate to question whether the political rationale for promoting non-state actor actions is warranted. Specifically, and in light of the scant objective evidence that is currently available, two issues deserve consideration. Firstly, the appropriateness of institutionalising non-state actor actions, without any associated transparency requirements. Secondly, the opportunity cost associated with public (and private) sector funding of non-state actor actions.

Transparency requirements

Beyond the rhetoric of “strengthening” the technical examination process through non-state actor participation, and “welcoming” increased efforts on the part of non-state actors, the UNFCCC will have to introduce basic accountability requirements on these actors. These requirements are essential, if non-sate actor actions are to be embedded in the international climate change regime in a structured manner, and they are to make a sizeable contribution to it. In practice, this means that basic monitoring and reporting requirements would have to be agreed to, and met. For most non-state actor actions, such requirements would undermine their main raisons d’être – namely the lack of oversight, and the non-committal nature of their objectives. Therefore, from this point of view, increased institutionalisation of non-state actor actions is likely to be challenging.

Opportunity costs

While it is clear that public funds contribute to financing non-state actor actions, the overall amounts of public funds invested, and the share that these amounts represent, vis-à-vis the total ‘budget’ of non-state actor actions, are not known. In the likely event that these public sector funds are not additional – in the sense that they ‘displace’ funding that would have otherwise been invested in other, related activities – it is legitimate to question whether these public funds are better used through non-state actor actions, as opposed to state actor actions. The question is not whether public funds should be directed to non-state actor actions, but rather how efficient and effective non-state actor actions are, compared to ‘equivalent’ state actor-led actions. The relevance of this question increases with both the political and (public sector) budgetary stakes associated with the institutionalisation of non-state actor actions.

 

 

Fatemeh Bakhtiari is a researcher at the UNEP DTU Partnership, Department of Management Engineering, Technical University of Denmark in Copenhagen, Denmark.